LONDON: Supermarket giant Asda has worked around its logistics problems in the north east by signing up a deal with PD Teesport for a deep sea container facility which will be used to distribute non-food products. As part of the deal, it will also build a £20m import centre at Teesport near Middlesbrough that will help create 300 jobs.

It is being hailed as a landmark deal for the ports industry and expected to change the economy of the region, as other retailers may be inspired to follow the Asda example.

Asda will begin by building a 360,000 sq ft warehouse building on the 18-acre site at the port. Construction is expected to be completed by February 2006. Once the logistics operations are in place, another 150,000 sq. ft. facility will be established on an additional 5.6 acres plot.

With the north east port facilities Asda will be able to save two million road miles a year by shipping over two-thirds of its distribution direct to Teesport. The supermarket chain receives its stock from various international destinations at southern ports from where it is then transported by road to distribution centres in the north. This roundabout distribution route will end once the deep sea container facility and the warehouse are operational.

Besides enabling Asda to distribute its non-food stock to its stores throughout the UK, the rerouting will also help ease the congestion in southern ports like Southampton and Felixstowe.

The supermarket giant is owned by US-based retail chain Wal-Mart.

LONDON: The Confederation of British Industry is all set to take on the workers as it is going to demand a raise in the retirement age in Britain in order to avert a public sector pensions crisis. The CBI’s director general Sir Digby Jones is expected to tell the Labour Party conference at Brighton that it is unfair for private sector workers and tax-paying pensioners to subsidise civil servants and council staff in retirement.

Sir Digby will ask the government to be firm with the unions and take on public pension reforms as the CBI has found that the liability on account of pensions for public sector workers has more than doubled to 500 billion pounds over a decade. Sir Digby says the public sector retirement age should be raised to 65 while the pension benefit formula should be revamped in order to make it affordable for the employers.

The Institute of Directors (IoD) too has sought a raise in the pension age. The IoD, in a report, said it should be raised to 70.

Meanwhile, the labour unions are mulling direct action. Unison, the most-represented public sector union has threatened that strikes are “on the cards”. Unison’s general secretary Dave Prentis will tell his 2 million constituents that they are facing huge cuts in their pension rights under plans put forward by the government. He will also argue that such moves will mean increasing costs for the NHS as 75 per cent of paramedics are forced to retire before the age of 60 due to ill health.

In a related development, members of the Pension Action Group will protest when chancellor of the exchequer Gordon Brown addresses the conference. They wish to highlight that fact that they lost most or all of their pensions when their company schemes failed and the government did not intervene.

BERLIN: German sportscar maker Porsche yesterday confirmed that it would buy/build a 20 percent stake in Volkswagen in order to help the latter prevent any hostile takeover occuring.

The Porsche investment in Volkswagen worth at least £2bn is expected to place Porsche among the majority shareholders with Volkswagen, the German state of Lower Saxony and Porsche totaling a combined voting stake of 51.2 percent. The family-run Porsche would be the biggest shareholder with its 20 percent stake.

For some time now, Volkswagen’s fortunes have been on a downturn with its operations in the US and Spain running up huge losses, trouble in China and European operations facing the prospects of downsizing. With its share price plummeting, the troubled car manufacturer has been vulnerable to a hostile takeover.

Investing in VW will also mean a strategic move for Porsche who were worried their dependence on the former’s cooperation might expose their own business to some risk, especially if a hedge fund were to buy VW. The chassis for Porsche’s Cayenne are made by VW who are a significant supplier contributing 30 percent to Porsche’s sales volume.

The state of Lower Saxony had until now been the largest shareholder with 18.2 percent and was aware of VW’s vulnerability and been hoping for just such a partnership in order to stave off a foreign takeover. VW is one of the largest employers in LowerSaxony.

The markets were surprised by the deal and have reacted sharply: Porsche’s share price fell 11.7 percent. However, analysts said this was the right time to buy Porsche shares as the deal would help the company secure the production of its Cayenne as well as give it access to VW’s production capacity.

The luxury car maker currently has less than 5 percent stake in VW.

NEW YORK: Japanese game maker Nintendo is cutting the price of its portable game device Nintendo Dual Service by 10 per cent across Europe. From 7 October, the model will be available for 89.99 per cent, 10 pounds lesser than its prevailing off-the-shelf price. In the Euro countries, it will carry a price tag of 129 euros.

Nintendo is also introducing its Nintendogs game in the European market. Along with the DS device, the game will cost 99 pounds or 149 euros. There are three versions, each having a choice of five different dogs including Labradors, corgis, Chihuahuas and King Charles spaniels. Each dog has its own personality and can learn about 120 tricks. The dogs remain as puppies, although they become more controllable with age.

Nintendo, which has sold over 1.5 million copies of Nintendogs in Japan and North America, said it is an adaptation of its earlier Tamagotchi cyberpet. But, the dogs are more realistic with looks and feel and they are immortal. They demand food and water and walk and tend the owner with affection, even catch balls, meet other dogs and can participate in dog shows. They defecate on the pavements and if the owner fails to clean up, other dog owners can shun the defaulters. They can be afflicted with fleas, be moody and even hide in order to catch the owner’s attention.

Nintendo’s Robert Saunders said the game does not have a beginning or end and it can be played for a few minutes or even hours. The dogs keep themselves happy on their own for hours. If the dog is put in sleep mode, it will start barking when it is in range of another person playing the game.

Although Nintendo has dominated the portable video games market for long, it has seen its market share reducing after Sony came out with its PlayStation Portable, in August in Europe. Sony has kept the price of PSP at 179 pounds or 249 euros, maintaining that it is targeted at an older game-playing section.

Nintendo is planning to launch its wireless gaming service, Nintendo Wi-Fi Connection, later this year and the Mario Kart DS will be the first game to work with the wireless connection.

The Nintendo DS, which came into Europe this spring has had encouraging response from online game enthusiasts. Its dual screen facilities, touch-screen technology, wireless gameplay, microphone input and Wi-Fi compatibility, available in a small device, has indeed spurred people and the company could achieve a sales of $ 1 million in Europe in three months. It has some 30 software titles.

Nintendo intends to bring in a number of other gaming devices before the end of 2005, which include Advance Wars: Dual Strike, Pac ‘N’ Roll, Nintendo Touch Golf: Birdie Challenge and Kirby Power Paintbrush.

LONDON: Cosmetics firm Rimmel will review its contract with super model Kate Moss, who is named in instances of drug abuse. The company said it is shocked and dismayed by the allegations surrounding the model’s behaviour and that it is reviewing the contract. Rimmel, the top-selling U.K. cosmetics brand, had signed Moss in September 2001 and renewed her contract last year. She models for mascara, nail polish, lipstick and other cosmetics for Rimmel.

British newspapers had published pictures of the 31-year-old model consuming cocaine. She is yet to react to the allegation publicly.

She has already been dropped from modelling assignments by firms such as U.K. fashion store Burberry and Swedish clothing company Hennes & Mauritz. Even French fashion house Channel said it will not renew an existing contract when it expires in October. According to estimates, Moss earns as much as 4 million pounds from her modelling contracts.

Hennes & Mauritz, by far the largest fashion store in Europe, said it is invoking a provision in the contract that stipulates that its models should be “healthy, wholesome and sound”. It said it has decided that a campaign with Moss is not consistent with H&M;’s clear disassociation from drugs. Moss was to model a one-time collection from designer Stella McCartney for the fall 2005.

Burberry is cancelling an autumn campaign with Moss following a mutual consent.

The model is now facing a police inquiry into the alleged involvement with cocaine. If she is found to have used the drug, she can be charged with possession of the drug, which is a serious offence. The police generally probes drug dealers rather than users, but London’s police commissioner Ian Blair said the policy is adaptable to the impact of events.

Moss had won a libel case recently against Daily Mirror over allegations that she had collapsed after ingestion of the drug in Barcelona in 2001.

The model, with a two-year daughter, has been in media glare following revelation of her relationship with pop star Pete Doherty, who has admitted to having used cocaine and heroin. With an estimated fortune of 30 million pounds, she is best known for her work for Calvin Klein.

LONDON – Virgin Atlantic boss Sir Richard Branson has called on governments across the world to break the monopoly of the Opec and try and build at least 10 refineries to meet the growing demand for petrol and oil.

Sir Branson said that the fuel costs were hitting his airline hard and consequently he was exploring possibilities to build a refinery and towards this end was planning to sound out the government, “At the moment there’s an enormous shortage of refineries in the world. Every one of the refineries is at capacity, the oil companies are not building new refineries, and we have put a team on trying to raise money to build at least one,” he said.

Fuel bills for Virgin Atlantic and Virgin Express had hit £750 million a year, an increase of over £300 million a year over the last couple of years. And in the aftermath of the tragic Hurricane Katrina, fuel prices tore through the roofs hitting consumers and businesses hard. Oil companies were accused of gouging prices, but in the end people had to pay up. “If we can encourage governments to confront this issue, if we can get western governments together to work out how to deal with the issue, we think we can make a real difference,” Branson said adding that even a tiny reduction in the airline’s fuel costs could make a significant difference to consumers.

As fuel prices have begun returning to pre-Katrina rates, a price war has broken among suppliers to attract more customers. Esso confirmed a 4 pence reduction in its UK petrol and diesel prices effective from Friday, while supermarkets Asda and Tesco have already done so. Royal Dutch Shell and BP were also planning to cut prices.

Sir Branson came down heavily on the Opec countries and said that they collude to keep oil prices high, “The western world should have a counterbalance to that. If $20 billion was put aside to build 10 new refineries, oil prices would start to collapse again,” he said. He felt that the government should reward companies who practice fuel efficiency by providing tax breaks. “If they intervene in the short term and do something too radical to stop growth, we will have an incredible recession,” he concluded.

LONDON: The U.K. government has postponed the proposed revaluation of millions of homes in England, which would have led to substantial increase in council taxes. The review was expected to have brought one in every three homes in a higher tax band, mostly in south of England.

A senior government official said the revaluation exercise will be postponed — and not cancelled. The last time the valuation was conducted was in 1991.

The council tax is a local tax based on property prices with houses put into eight categories. Alongside the revaluation, there is an independent evaluation of the council tax now under way conducted by Sir Michael Lyons. The government official hinted that the government is waiting for the Lyons report. Sir Michael is intending to publish his recommendations in December, with implementation due to coincide with revaluation in April 2007.

The revaluation has been described as a time bomb for the Government because property prices — in London and the South East in particular — have risen significantly since the last valuation. There has been opposition to the exercise with many people saying they are already paying higher rates of council taxes. Under the existing eight band system, owners in the top-rate band H are paying twice as much as people on band D.

The revaluation was to cover all the 22 million English homes and possibly have them rebanded, based on their value on April 1 this year. The proposal envisages that anyone whose house has risen in value by more than the national average since the 1991 valuation is likely to move to a higher tax band in April 2007. In the 1991 valuation, the average house price was 73,000 pounds. It is now around 180,000 pounds. However, houses in London, the South East and South West could command prices in the range of 310,000 pounds to 440,000 pounds and the owners could expect a tax increase of 1,000 pounds annually. Pensioners would have been the hardest hit by the proposed increases.

Revaluation has already been done in Wales, and it has shown that 58 per cent of homes remained in the same tax band, while about a third had moved to a higher band. However, in some areas where house prices have gone very high, the tax increase has been really high — 64 per cent in Cardiff and 52 per cent in Wrexham.

While the households paid 8.8 billion pounds in council taxes in 1996-97, it was 16.4 billion pounds in 2003-04, an increase of 86 per cent.

LONDON – BT has announced that it will be conducting pilot trials that would enable it to provide broadband services to the remaining 0.2 percent of areas where the service is currently unavailable.

This is because these pockets are out of range of the nearest telephone exchange. BT will install broadband switches (DSLAMS) near street cabinets and connect them via a fiber optic cable to the exchange. Nine locations in Yorkshire and Northern Ireland have been identified for the trials that will run into the summer of the next year.

Commenting on this project, Cameron Rejali, BT Wholesale managing director for products and strategy said, “While the vast majority of people can now get access to broadband we haven’t lost sight of the small pockets where access to this vital technology remains an issue. We’re investigating a range of possible solutions which might help us get broadband to small pockets of customers in certain areas.”

BT had extended the availability of broadband services to local exchanges that had been upgraded so that many users would be able to get 512kbit/s ADSL service. This move had ensured that there was 99.8 percent broadband connectivity. Now, BT is focusing on integrating the remaining 0.2 percent as well.

“We believe the approaches set to be trialled can get ADSL service to such areas but BT Wholesale has to investigate the technical, commercial and operational factors which will influence any future deployment of such solutions,” pointed out Rejali. About 200 trialists have been invited to take part in these pilot trials.

BT is also conducting similar trials in December to provide broadband services to Charlton Down area of Dorchester, Dorset, and the Kingswells area of Aberdeen. In these areas, the cable technology is not broadband-enabled and hence they have been excluded till now. Both these trials aim to test the technical, logistical and commercial aspects of providing broadband services to remote areas.

LONDON – The UK’s Competition Commission has said it has found evidence that retail store cards were being overcharged and consequently consumers were ending up paying an extra £100 million a year. The Commission further said that store cards are uncompetitive.

These store cards charged higher interest rates and were thus drilling a hole into the holders’ pockets. Around 14 million store card accounts exist in the UK. The competition watchdog added that it wanted warnings on the cards to inform consumers of these liabilities.

In a report that was released this morning, the commission said that since there was no pressure on the stores to ensure that they charge competitive Annual Percentage Rate (APR) interest on credit, they were virtually charging at their will.

“Store card APRs (interest rates) are on average some 10 to 20 percent higher across the store card market as a whole than they would have been had they reflected providers’ costs, including the cost of capital,” said commission deputy chairman Christopher Clarke. “The detriment to cardholders in terms of the excess prices paid for credit and insurance is in the region of 80 million to 100 million pounds a year,” he added. The Commission’s investigation has tuned up some problems in this regard for which it is consulting to find possible solutions. Following a parliamentary Treasury Select Committee enquiry into UK debt, the credit card industry had agreed to put out similar warnings as demanded by the commission on the general use credit cards.

“People, it seems, are genuinely ignorant about the rates they are signing up to when they take out a store card…if we raise the level of consumer knowledge then competition will improve and APRs, which are too high, should fall,” said a Competition Commission spokesman.

HSBC Holdings PLC and GE Consumer Finance are two of the leading companies that provide store cards in Britain.

LONDON: Readers of the Guardian were surprised this morning to find their paper had sort of shrunk from a broadsheet to a size that is known among the media as the ‘Berliner’.

It isn’t exactly a tabloid but readers are expected to find the new size “small enough to handle” as their ad says. The newspaper hopes the relaunch and the new look – all pages in colour, will win back readers that had moved to The Times and the Independent in 2003 when these newspapers changed to tabloid format.

In the July 2005 readership review by the Audit Bureau of Circulation (ABC), Guardian’s circulation had dropped by 358,000.

Guardian said the downsizing was in response to research which revealed that readers were uncomfortable with the broadsheet format and would rather read a newspaper that was easier to handle in many everyday situations such as commuting to work. The ‘Berliner’ size is midway between a broadsheet and a tabloid.

There was also the other challenge from free newspapers such as the Metro which was forcing other newspapers to reconsider their marketing strategy. Mainline newspapers were losing readers also to news sources like television and the Internet.

For Guardian, the redesign has meant a new masthead and a new typeface – the Guardian Egyptian and new state-of-the-art printing equipment – three MAN Roland ColourMan presses from Germany. Every page is now in colour and easier on the eye compared to Guardian’s earlier B/W look. There will also be a couple of new sections and 12 pages will feature the sports section exclusively.

The “radical change” as Guardian editor Alan Rusbridge calls it, involved a cost of £80 million and 1 1/2 year’s preparation.

Currently, the once the broadsheet newspapers are the Daily Telegraph and the Financial Times.